FED PRESIDENT BULLARD: We Don't Have A Good Explanation For Low Inflation, So We Need To Be Careful

Federal Reserve Chairman Ben Bernanke rocked the global financial markets on June 19 when he laid out a timeline for the tapering of the Fed's stimulative quantitative easing program.

Just two days later, St. Louis Fed President James Bullard issued a statement saying why he thought it was a mistake for the Fed to make such statements.

One of his big concerns was how low inflation was getting.

"Why has inflation been low?" Bullard asked rhetorically at the Kansas City Fed's summit in Jackson Hole, Wyoming. "We do not have a good explanation, so we should be careful."

He reiterated his recent dissent.

"Given recent forecasting performance, we should be careful in using an optimistic forecast to justify current policy decisions," he said. "A more prudent approach would be to wait to see if better macroeconomic outcomes materialize in the months and quarters ahead."

Bullard laid out his whole thought process in a brief presentation on the economy.